The 5th U.S. Circuit Court of
Appeals said it was troubled by the lack of evidence on the record that
Houston Poly ever provided Kenneth Kujanek with the controlling
documents for its profit-sharing plan, as required under ERISA. Kujanek maintained throughout litigation that during his
employment with Houston Poly, he never received the Summary Plan
Description, Adoption Agreement, or Defined Contribution Prototype Plan
and Trust.

Houston Poly argued that it provided the requisite plan
information to Kujanek in the summary allocation report it issues to
plan participants every year. The summary allocation report lists the
participant’s beginning balance, contribution, and ending balance for
the year on a spreadsheet, and notifies participants that they have a
right to examine documents such as the full annual report, accountant’s
report, and a list of the plan’s assets and liabilities. According to
the opinion, the report contains no information about how a participant
may elect to receive a rollover distribution, nor does it inform the
participant of his rights under the profit-sharing plan.

A district court had awarded Kujanek statutory penalties
starting from a 2008 request for documents during the discovery phase of
prior litigation, but the 5th Circuit remanded the case back
to the district court for additional findings on whether Houston Poly
failed to furnish Kujanek with the requisite documents under ERISA §
104(b)(1), and if so, whether that omission serves as a basis for
statutory penalties.

The district court awarded Kujanek $183,881.88 in damages
“to restore plan losses”; $25,025 in statutory penalties; and attorney’s
fees in the amount of $60,030. The appellate court affirmed the award of
damages and attorney’s fees.

In September 2007, Kujanek resigned from Houston Poly
after 17 years with the company as a sales representative. At the end of
2007, Kujanek’s profit-sharing account with Houston Poly had vested
benefits totaling $490,198.78. Employees were required under company
policy to wait at least one year from the date of termination before
they could obtain a distribution of their account benefits.

Two months after Kujanek resigned, Houston Poly sued
Kujanek in state court for breach of employment contract, breach of
fiduciary duty to the company, and tortious interference with business
relations. In April 2008, during the discovery phase of the state court
litigation, Kujanek made a production request on Houston Poly for all
documents describing the terms and conditions of Houston Poly’s
contribution to its profit-sharing plan, and documents describing the
eligibility requirements for employees to receive benefits from the
plan. Houston Poly objected to the request on relevancy grounds and
refused to provide the documents.

After several requests for his profit sharing distribution
and a complete set of the plan documents, in April 2009, Houston Poly
responded by sending Kujanek a complete copy of the plan documents and a
rollover distribution of $306,000.